Gulfport, Miss. –  Michael Vincent Maes, 30, of Oakland, California, was sentenced today by U.S. District Judge Sul Ozerden to life in federal prison for conspiracy to possess with intent to distribute methamphetamine, attempt to possess with intent to distribute methamphetamine, conspiracy to launder money, and five specific acts of money laundering, announced U.S. Attorney Mike Hurst, Special Agent in Charge Jere T. Miles with Homeland Security Investigations, and Assistant Special Agent in Charge Derryle Smith with the Drug Enforcement Administration. 

Between June 2016 and February 2017, Maes was sending packages of methamphetamine to addresses in Slidell, Louisiana, for distribution throughout the Southern District of Mississippi.  The individuals distributing that methamphetamine would then deposit proceeds from those sales into Wells Fargo accounts in Biloxi and Gulfport at Maes’ direction.  All of the individuals distributing methamphetamine on the Mississippi Coast have previously pled guilty to their activities.  Maes was found guilty on September 21, 2018, after a four-day trial.  He was acquitted of one specific act of money laundering.

The case was investigated by Homeland Security Investigations and the Drug Enforcement Administration.  It was prosecuted by Assistant U.S. Attorneys John Meynardie and Kathlyn Van Buskirk.

Spokane – Joseph H. Harrington, United States Attorney for the Eastern District of Washington, announced that Jese Carillo Casillas, age 33, based out of Kennewick, Washington, was sentenced after having pleaded guilty on August 24, 2018 to Conspiracy to Distribute Fentanyl, Heroin, Methamphetamine, and Cocaine, as well as Conspiracy Launder Money. Senior United States District Judge Edward F. Shea sentenced Casillas to a 25-year term of imprisonment for his role in the drug conspiracy, to run concurrent to a 15-year term of imprisonment for Casillas’ role in the money laundering conspiracy, to be followed by a 5-year term of court supervision after he is released from federal prison. Upon completion of his sentence, Casillas will be deported because he is not a citizen of the United States.

According to information disclosed during court proceedings, this case arose from a joint investigation into the Ivan Calvillo Transnational Drug Trafficking Organization that has had a distribution cell rooted in the Eastern District of Washington since 2010. The investigation culminated in the arrest and indictment of 16 members of the organization for various drug trafficking and money laundering offenses. After Ivan Calvillo was murdered in Mexico in December 2015, Casillas took over operations for the organization, including the importation and distribution of Fentanyl, Heroin, Methamphetamine, and Cocaine. Casillas reported directly to the head of the transnational trafficking organization in Mexico. The organization was responsible for the monthly distribution of 50 to 100 kilograms of narcotics into the United States and Canada. From early 2015 until his arrest in August of 2016, this distribution network was organized, facilitated, and controlled by Casillas out of Kennewick, Washington.

This organization was known for its ability to import large quantities of these narcotics through designated half-way points in the Los Angeles and Riverside California areas into Vancouver, British Columbia, Canada, and to various locations throughout the Midwest and East Coast to include North and South Dakota, Minneapolis, Chicago, Kentucky, and New York for distribution.

In partnering with the Royal Canadian Mounted Police Federal Serious and Organized Crime Unit in Vancouver British Columbia and DEA Financial Crimes Task Force in Boston, Massachusetts, a large part of the investigation also involved the tracking of the organization’s drug cash proceeds. A DEA undercover officer, posing as a person who could launder the organization’s money, was in direct communication with Calvillo and later Casillas, who arranged for over two dozen cash money pick-ups of drug proceeds. The undercover agent would agree to pick up the cash drug proceeds and then took direction from Calvillo and Casillas as to where the laundered drug money should be wired. During this process, investigators were able to identify the scope of the organization as well as other members within this district. Calvillo and Casillas arranged for over $1.6 million dollars in cash drug proceeds to be picked up by the undercover operatives.

Joseph H. Harrington said, “This case highlights the joint commitment, dedication, and partnership between our state and federal partners as well as our international partners, in combatting this problem and the accompanying violence associated with trafficking such dangerous drugs into our community. I commend their outstanding work. This investigation made a substantial mark upon a large-scale organization operating throughout the world that had chosen our district as a point of operation. It is these types of investigations that bring into focus the dangers drug trafficking organization pose to our communities.”

Today’s enforcement action is part of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. The OCDETF program provides supplemental federal funding to the federal and state agencies involved in the investigation of drug-related crimes. This OCDETF investigation is being conducted by the Drug Enforcement Administration and Bureau of Alcohol, Tobacco, Firearms and Explosives.

This case was investigated by the Federal Bureau of Investigation’s Safe Streets Task Force in Tri-Cities Washington, the Drug Enforcement Administration in Boston, Seattle, Mexico City and Vancouver; the Royal Canadian Mounted Police Federal Serious and Organized Crime Unit in Vancouver British Columbia, Canada; Kennewick Police Department, Richland Police Department, Pasco Police Department, Benton County Sheriff’s Office, and Washington Department of Corrections. This case was prosecuted by Stephanie Van Marter and Caitlin Baunsgard, Assistant United States Attorneys for the Eastern District of Washington.

NEW ORLEANS –U.S. Attorney Peter G. Strasser announced that TONY LAM, age 41, of New Orleans, was sentenced yesterday after previously pleading guilty to a one-count bill of information for distribution of over 40 grams of a mixture containing fentanyl. 

United States District Court Judge Martin L.C. Feldman sentenced LAM to 327 months of imprisonment followed by 8 years of supervised release, and a $100 special assessment fee. 

According to the bill of information, on July 7, 2017, LAM distributed over 40 grams of a mixture containing fentanyl. 

U.S. Attorney Strasser praised the work of the Drug Enforcement Administration in investigating this matter.  Assistant United States Attorney Jonathan L. Shih is in charge of the prosecution.

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TULSA, Okla. – A former University of Oklahoma football player has been ordered to federal prison following his conviction of conspiracy to commit wire fraud in a scheme that defrauded investors of $869,300 announced U.S. Attorney Trent Shores. Timothy Hamilton, 31, of Dallas, Texas, pleaded guilty Sept. 14, 2018.

Today, U.S. District Judge John E. Dowdell sentenced Hamilton to the maximum allowable penalty of 60 months in prison to immediately be followed by three years of supervised release.

The court also ordered a criminal forfeiture money judgement in the sum of $869,300, representing proceeds obtained through the conspiracy. All monies will go to provide restitution to the victims.

“T.J. Hamilton’s extravagant and indulgent lifestyle was fraudulently built on the financial savings of those who believed in him. Hamilton persuaded investors to part with their money by exploiting his status as a former University of Oklahoma football player, using his church connections, making a false claim that he was a chemical engineer, and through the bogus endorsements of his products supposedly from former University of Oklahoma athletes,” said U.S. Attorney Trent Shores. “Hamilton repeatedly lied to 18 investors in order to bilk them out of almost $900,000. He compounded his crime by lying under oath in civil suits brought by those same investors in order to conceal his crimes. His scheme had a severe impact on victims, most notably a widow who lost her life savings.  In court today, T.J. Hamilton faced those he cheated. He now has to deal with the consequences of his criminal actions.”

Victims told the court at length how Hamilton’s fraud harmed their professional and personal reputations. They further expressed that they trusted Hamilton and wanted to support his vision. Instead he cheated them. The financial impact of his fraud was devastating.

In handing down the sentence, Judge Dowdell noted that Hamilton had many opportunities in the course of his business ventures to inform investors of initial business failures, but he continued to accumulate investors, systematically draining members of his church and others of an exorbitant amount of money. The judge further noted that Hamilton’s charm, innate intelligence and ability to lie without remorse allowed him to steal almost $900,000 from victims in order to live lavishly.

At his plea hearing, Hamilton, who goes by T.J. Hamilton, admitted to promoting false investment opportunities relating to business ventures that were purportedly going to produce and market sportswear and nutritional supplements.  At the time of his crime, Hamilton was a resident of Oklahoma.

As part of the scheme, Hamilton established and claimed to be the President and CEO of multiple companies. The Clean Athlete, LLC, established in 2011, promoted sportswear that could supposedly control the sweat and odor that comes with athletic play.  Two other companies, Clean Athlete Nutrition, LLC, and Complete Athlete Nutrition, LLC, both established in 2012, claimed to create supplements that would improve athletes’ metabolism. His parents, Gena and Timothy Hamilton, were managing members of the companies. They both pleaded guilty on Sept. 14, 2018, for providing false income information in order to receive a car loan from a bank.

Upon receipt of investor funds, the Hamiltons used a majority of the money for personal gain, primarily for T.J. Hamilton’s country music career ambitions and his extravagant lifestyle.

The Department of Treasury, Internal Revenue Service—Criminal Investigation Division investigated the case.  Assistant U.S. Attorneys Kevin C. Leitch, Richard M. Cella, Charles M. McLoughlin and Catherine J. Depew prosecuted the case.

HAMMOND – Kenneth R. Morrison, age 68, of Whiting, Indiana was convicted of interstate transportation of stolen goods after a 4-day jury trial before U.S. District Court Judge Philip P. Simon, announced U.S. Attorney Kirsch.

According to records in the case, between December 2014 and January 2015, without authority the defendant dismantled the Monon Bridge in Hammond, Indiana, and transported pieces of the bridge to Burnham, Illinois where he sold the scrap for $18,000.  He also sold parts of the bridge to a scrap dealer in East Chicago, Indiana.  CFX Railroad gifted the Monon Bridge to the City of Hammond in 1987.  The bridge, built in 1910, spanned the Grand Calumet River near Marble Street in Hammond. 

Morrison’s sentencing date is scheduled for March 21, 2019.  

This case was investigated by the U.S. Environmental Protection Agency-Criminal Investigation Division, U.S. Environmental Protection Agency-Office of Inspector General, and the U.S. Coast Guard Investigative Services with assistance from the Indiana Department of Natural Resources, Indiana Department of Environmental Management and other members of the Environmental Crimes Task Force and was prosecuted by the U.S. Department of Justice, Environmental Natural Resource Division, Environmental Crimes Section Trial Attorney Richard J. Powers and Assistant United States Attorney Toi Denise Houston of the Northern District of Indiana.

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ROCKFORD — LEILANI HILLIS, 60, of Rockford, the former director of operations of a Rockford non-profit organization, was charged today in federal court with one count of mail fraud and one count of tax fraud. 

Hillis was an employee of the non-profit organization since 2001.  During her employment, Hillis handled the organization’s payroll, human resource matters, accounting, and oversaw the annual audit.  As of 2009, Hillis had signatory authority on the organization’s bank account and access to the organization’s PayPal account. 

According to a criminal information, the organization issued employees a credit card in the employee’s name.  From 2009 through April 2018, Hillis schemed to enrich herself by using her employee-issued credit card to make more than $600,000 in unauthorized purchases for her personal benefit.  Hillis concealed her crime by using the organization’s accounting codes to make it appear the purchases were for the organization’s benefit, and she forged the initials of the organization’s president on the expense reports.  Hillis issued and signed checks from the organization’s account to the bank, knowing the payment included money to pay for the unauthorized purchases.  Hillis also did not report as income the money from the organization that she used to pay the organization’s credit card for her unauthorized personal purchases.

Each count of mail fraud carries a maximum potential penalty of up to 20 years in prison, and tax fraud carries a maximum potential penalty of up to three years in prison.  Each charge also carries a fine of up to $250,000, or twice the gross gain or gross loss resulting from that offense, whichever is greater, plus full restitution and a period of supervised release following imprisonment of up to five years.  If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory U.S. Sentencing Guidelines. 

Hillis is scheduled to appear for arraignment before U.S. Magistrate Judge Iain D. Johnston on Dec. 19, 2018, at 9:30 a.m.

The public is reminded that an information contains only charges and is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

The charges were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of Federal Bureau of Investigation; and Gabriel L. Grchan, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division in Chicago.

The government is represented by Assistant U.S. Attorney Scott R. Paccagnini.

According to court documents, on March 8, 2018, ARTEAGA-CENTENO was found in the United States after having been previously deported from the United States on May 24, 2013.  Further, on September 29, 2011, ARTEAGA-CENTENO was previously convicted of a felony.

United States District Court Judge Martin L.C. Feldman sentenced ARTEAGA-CENTENO to thirty-seven (37) months in prison, and ordered him to pay a $15,000 fine. A three year term of supervised release was also imposed, in addition to a $100 special assessment fee.  Following the completion of his sentence, the defendant will be surrendered to the custody of the U.S. Immigration and Customs Enforcement for removal proceedings.

U.S. Attorney Strasser praised the work of Immigration and Customs Enforcement agents in investigating this matter. Assistant United States Attorney Jon Maestri is in charge of the prosecution.

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Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Philip R. Bartlett, Inspector-in-Charge of the New York Office of the U.S. Postal Inspection Service (“USPIS”), and William F. Sweeney Jr., Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced that HECTOR MAY, the president of Executive Compensation Planners, Inc. (“ECP”), a registered investment adviser and financial planning firm located in New City, New York, pled guilty today to participating in a conspiracy to defraud certain investment advisory clients (the “Victims”) out of more than $11 million.  MAY pled guilty before U.S. Magistrate Judge Judith C. McCarthy.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “As Hector May admitted today, for decades he and his co-conspirator violated his clients’ trust by siphoning money from their accounts to line their pockets and continue to perpetrate their illegal scheme.  In total, May and his co-conspirator stole more than $11 million.  Now, he has confessed to his crimes and faces significant time in prison.”

USPIS Inspector-in-Charge Philip R. Bartlett said:  “This case has all the markings of a classic Ponzi Scheme with payments made to investors with other investor money, bogus account statements, etc. Mr. May also used investor money to pay personal and business expenses. His day of reckoning has arrived.”

FBI Assistant Director-in-Charge William F. Sweeney Jr. said:  “Hector May spent decades defrauding investors and gaming the system to make himself wealthier, all at the expense of those who trusted him to serve as a responsible steward of their funds.  This kind of criminal behavior undermines the strength and security of our financial systems.  Today’s conviction should serve as a warning to those who think they can get away with similar schemes -- the FBI and our law enforcement partners will discover the truth and hold you accountable for your actions.”

According to the Information filed today, to which MAY pled guilty:        

Since 1982, MAY has been the president of ECP and has provided financial advisory services to numerous clients.  Since 1994, MAY has been a registered representative of a broker dealer (“Broker Dealer-1”).  In its role as a broker dealer, Broker Dealer-1 facilitated the buying and selling of securities for clients of Broker Dealer-1’s registered representatives, including clients of MAY.  To that end, Broker Dealer-1 and associated clearing firms maintained securities accounts for ECP’s clients and, through those accounts, held ECP’s clients’ money, executed their securities trades, produced account statements reflecting activity in the clients’ accounts, and forwarded these account statements to ECP’s clients.

In order to obtain money from the Victims’ securities accounts with Broker Dealer-1, MAY advised the Victims, among other things, that they should use money from those accounts to have ECP, rather than Broker Dealer-1, purchase bonds on their behalf.  He further represented that by purchasing bonds through ECP directly, the Victims could avoid transaction fees.  Because MAY lacked the authority to withdraw money directly from the Victims’ accounts with Broker Dealer-1, he persuaded the Victims to withdraw the money themselves and to forward that money to an ECP “custodial” account (the “ECP Custodial Account”), so that he could use the money to purchase bonds on their behalf. 

With the assistance of his co-conspirator (“CC-1”), MAY guided the Victims, first, to withdraw their money from their Broker Dealer-1 accounts, and second, to send that money to the ECP Custodial Account by wire transfer or check.  At times, MAY falsely represented that the funds being withdrawn from Victims’ Broker Dealer-1 accounts were the proceeds of prior bond purchases MAY had made.  After the Victims sent their money to the ECP Custodial Account, MAY did not use the money to purchase bonds.  Instead, MAY and CC-1 spent the money on business expenses, personal expenses, and to make payments to certain Victims in order to perpetuate the scheme and conceal the fraud. 

Specifically, in some cases, MAY used Victims’ funds to make purported bond interest payments to other Victims.  In other cases, MAY used Victims’ funds to make payments to other Victims who wished to withdraw funds from their accounts.  MAY and CC-1 also created phony “consolidated” account statements that they issued through ECP and sent to the Victims.  These “consolidated” account statements purported to reflect the Victims’ total portfolio balances and included the names of bonds MAY falsely represented that he purchased for the Victims and the amounts of interest the Victims were supposedly earning on the bonds.  In order to create the phony consolidated account statements, MAY provided CC-1 with bond names and false interest earnings, and CC-1 created ECP computerized account statements and had them distributed to the Victims.

To keep track of the money that the co-conspirators were taking from the Victims, CC-1 processed the Victims’ payments for the purported bonds, entered them in a computerized accounting program, and, through that program, kept track of how MAY and CC-1 received and spent the Victims’ stolen money.  In this way, from the late 1990’s through March 9, 2018, MAY and CC-1 induced Victims to forward them more than $11,400,000.

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MAY, 77, of Orangeburg, New York, pled guilty to one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison and a maximum fine of $250,000 or twice the gross gain or loss from the offense; and one count of investment adviser fraud, which carries a maximum sentence of five years in prison and a maximum fine of $10,000 or twice the gross gain or loss from the offense.  Sentencing before Judge Vincent L. Briccetti has been scheduled for March 15, 2019.

The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Berman praised the outstanding investigative work of the U.S. Postal Inspection Service, Special Agents of the United States Attorney’s Office, and the Federal Bureau of Investigation.

In a related case, the Securities & Exchange Commission brought a civil action today against May and another in the White Plains federal court. 

The criminal case is being prosecuted by the Office’s White Plains Division.  Assistant U.S. Attorneys Margery B. Feinzig and Vlad Vainberg are in charge of the prosecution.

CHICAGO — The former Chief Financial Officer of a north suburban automobile parts company has been indicted on federal fraud and money laundering charges for allegedly embezzling $700,000 in company funds.

While serving as CFO of the Libertyville-based company, MICHAEL PUGLISI fraudulently wrote corporate checks to three shell companies that he created, according to an indictment returned Tuesday in U.S. District in Chicago.  Puglisi fraudulently set up the shell companies with names that closely resembled or were identical to the names of actual vendors of the auto parts company, the indictment states.  Puglisi deposited checks from the auto parts company into bank accounts he opened in the names of the shell companies, and then transferred the money to his personal bank or investment accounts, the indictment states.

The indictment charges Puglisi, 63, of Lisle, with four counts of wire fraud and three counts of money laundering.  Arraignment in U.S. District Court has not yet been scheduled.

The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Jeffrey Sallet, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation.  The government is represented by Assistant U.S. Attorney Matthew Schneider.

According to the charges, Puglisi’s fraud scheme began in 2013 and continued until earlier this year.  Puglisi allegedly made false entries in the auto parts company’s accounting reports and financial statements in order to conceal his theft.  As a result of his actions, Puglisi caused a loss to the company of at least $700,000, the indictment states.

The public is reminded that an indictment is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. 

Each count of wire fraud is punishable by up to 20 years in prison, while each money laundering count carries a maximum sentence of ten years.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

Baltimore, Maryland – U.S. District Judge Richard D. Bennett sentenced Mark Ian Gaver, age 56, of Bonita Springs, Florida, and previously of Middletown, Maryland, today to 17 years in federal prison, followed by three years of supervised release, on his conviction for eight counts of bank fraud and two counts of money laundering arising from a scheme in which he obtained over $49 million in bank financing for his company Gaver Technologies, Inc., d/b/a GTI Federal (GTI), using false and fraudulent financial statements, balance sheets, and certifications of outstanding accounts receivable.  Judge Bennett also ordered Gaver to forfeit assets valued at approximately $4.2 million, and pay restitution in the amount of $48,774,308.75.  A federal jury convicted Gaver on August 1, 2018.  Gaver has been in custody since his arrest on November 15, 2017, when he entered the United States from Canada. 

The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Gordon B. Johnson of the Federal Bureau of Investigation (FBI), Baltimore Field Office; and Acting Special Agent in Charge Robert W. Manchak, Federal Housing Finance Agency, Office of Inspector General (FHFA-OIG), Northeast Region.

“Mark Gaver committed a massive fraud to maintain his lavish lifestyle,” said United States Attorney Robert K. Hur.  “This sentence ensures that he will not profit from his crimes and will be held accountable for his years of lies.”

According to the evidence presented at his seven-day trial, in 1998 Gaver formed GTI, an information technology company based in Frederick, Maryland.  Between November 2008 and December 2016, Gaver submitted materially false financial documents to a federally insured bank, including fraudulent audit reports and contract status reports, in order to establish and to obtain successive increases in the line of credit from the lender for GTI.  Based upon the false documentation submitted by Gaver, the lender ultimately extended approximately $49 million in financing to GTI.  The evidence showed that Gaver diverted a large portion of these fraudulently obtained funds to his own personal use.

According to the evidence presented at trial, the bank initially approved an $18.5 million line of credit for GTI in August 2009, when it took over the line of credit from another bank that had previously extended a $16.5 million line of credit to GTI.  This line of credit was subsequently increased eight separate times between March 2010 and March 2016, growing from $18.5 million to a total of $50 million.  On an ongoing monthly, quarterly, and annual basis, and in connection with each request by Gaver for an increase in GTI’s credit line, the bank required GTI to submit specific documentation disclosing the company’s financial performance and condition.  The required documentation included audited annual financial statements, quarterly balance sheets, monthly borrowing base certificates, and monthly accounts receivable aging reports.  The monthly borrowing base certificates required Gaverto certify the amount of GTI’s outstanding accounts receivable, and were used by the bank to establish a maximum borrowing amount for GTI. Under the terms of GTI’s line of credit agreement with the lender, GTI was only allowed to borrow up to 75% to 80% of the total amount of GTI’s outstanding accounts receivable, and the funds loaned by the bank were only to be used by GTI for business purposes. 

The evidence proved that between August 2009 and December 2016, Gaver also submitted Quarterly Contract Status Reports to the bank, which falsely represented that GTI had secured contracts with federal government agencies, such as the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and the National Aeronautics and Space Administration (NASA), or that overstated the amount of GTI’s ongoing contracts with federal government agencies. 

The evidence showed that some of the funds obtained from the lender were used by Gaver to cover regular business expenses and thereby keep GTI open, but that Gaver also diverted half of the post-2009 loan proceeds – approximately $15 million – to his own personal use.  For example, Gaver used loan proceeds to pay $779,000 for the rental of private planes that he used for non-business purposes, as well as to pay for personal pleasure trips to the Bahamas, France, Germany, Mexico, Jamaica, and the Bahamas.  Gaver also used the funds to purchase vacation homes, including a 4,000-square-foot condominium with a view of the Gulf of Mexico in Bonita Springs, Florida, which cost $2.275 million.  Gaver also used loan proceeds to purchase a 2012 Maserati Gran Turismo; a 2011 Mercedes Benz SL Roadster; and a private membership at an exclusive golf club located in Naples, Florida that cost $285,000. 

United States Attorney Robert Hur commended the FBI and the FHFA-OIG for their work on the investigation.  Mr. Hur also thanked Assistant U.S. Attorneys Jefferson M. Gray and Jeffrey J. Izant, who prosecuted the case.

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          The operator of three childcare centers in Edmonds, Washington settled a civil investigation with the U.S. Department of Justice by agreeing to a series of steps to accommodate attendance at the centers by children with diabetes, announced U.S. Attorney Annette L. Hayes.  ‘Grow with Us’ childcare centers agreed to train managers and staff on American with Disabilities (ADA) regulations and more specifically, how to ensure the medical needs of children with diabetes are met during their time at daycare. 

          The agreement follows complaints from the foster parents of a child with Type I diabetes, alleging that the childcare center refused to take reasonable steps to modify their policies, practices, and procedures to accommodate the child’s medical needs. 

            “The ADA is clear that all children, regardless of their health status, deserve full and equal access to schools, camps and daycare centers,” said U.S. Attorney Annette L. Hayes.  “I am pleased that after we began our investigation, ‘Grow With Us’ child care centers agreed to take steps to ensure their facilities were in full compliance with the ADA.”

            According to the settlement agreement, the childcare centers will provide a staff member to assist children with diabetes with routine care tasks such as testing blood sugar levels and administering insulin by pen, syringe or pump.  The childcare centers agree to train managers and staff and provide diabetes management information on its website.  The centers also have committed to report to DOJ about those leading the training and the training materials used by the center.

            Diabetes affects approximately 215,000 Americans that are 20 years or younger.  In recent years DOJ has reached settlements with other childcare providers, schools and camps with regard to diabetes care including, KinderCare, YMCA of Chicago and YMCA of Philadelphia.

            The investigation and settlement were handled by Assistant United States Attorney Kayla Stahman.

          An 18-month law enforcement operation resulted in 43 arrests and significant seizures over December 5-7, 2018, announced U.S. Attorney Annette L. Hayes.  Hundreds of law enforcement officers were involved in making arrests and serving search warrants targeting a multi-state drug trafficking network led by drug cartel members in Mexico.  The drug trafficking organization distributing heroin, fentanyl, cocaine, and methamphetamine was active in Washington State, New York, Arizona, Oregon, California, Tennessee, and Utah.  One of the local high-level managers of the drug trafficking group, CARLOS EDUARDO LOPEZ HERNANDEZ, 22, of Kent, Washington is in federal custody.

            “Drug rings that peddle dangerous drugs–especially fentanyl masquerading as oxycodone pills–are a real and present danger in our communities,” said U.S. Attorney Annette L. Hayes. “When these rings are operated by cartels in Mexico, we will bring federal resources to bear every day of the week.  I commend the hard work of all our federal, state, local, and tribal law enforcement partners who banded together to take decisive action and protect our western Washington cities and towns.”

            Before the recent law enforcement actions, as part of the investigation, agents and officers had seized 7 kilos of heroin, 1.5 kilos of products containing fentanyl, methamphetamine and $164,000 in cash.  On December 5through 7, 2018, law enforcement seized more than 40 pounds of heroin, 10,000 fake oxycodone pills containing fentanyl, 8 pounds of suspected fentanyl powder, 6.5 pounds of methamphetamine,  3 pounds of cocaine, 39 firearms, and more than $435,000 in cash.

          In Western Washington the group distributed drugs in Pierce, Kitsap, King, Skagit, and Snohomish Counties. Over the course of the investigation law enforcement seized thousands of counterfeit oxycodone pills tainted with fentanyl, a powerful and potentially deadly opioid.  Following one seizure from a vehicle, Washington State Patrol troopers were hospitalized for their accidental exposure during the investigation.

          “The dangerous pills containing fentanyl flowing through this pipeline operated by this Western Washington distribution network has been shut down,” said DEA Special Agent in Charge Keith Weis.  “Those profiting from pushing illicit opioids such as fentanyl and heroin into our most vulnerable communities will be met with a significant law enforcement response.”

            The investigation began 18 months ago with drug seizures by the Bremerton Police Department.  More recently, on November 28, 2018, law enforcement seized more than 13 pounds of heroin from the engine compartment of a semi-truck driven by a frequent smuggler for the ring.  In addition to coded cell phone conversations, many of the members of the ring also communicated via Facebook messenger. 

            “An agency the size of Bremerton can impact crime on a larger scale when it is able to partner with agencies like the DEA,” said Bremerton Chief of Police James Burchett.  “I am very proud of the hard work and dedication of all the officers and agents that made this operation a reality.”                

            This was an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation, providing supplemental federal funding to the federal and state agencies involved.  This investigation was conducted by the DEA Tacoma Resident Office and the Bremerton Police Department, with significant assistance from the Tahoma Narcotics Enforcement Team (TNET), Special Operations Division, Chantilly, Virginia, and Northwest High Intensity Drug Trafficking Area (HIDTA).

          The multi-agency takedown operation was supported by DEA Seattle; DEA Los Angeles; DEA San Diego, DEA San Francisco, and DEA Phoenix; as well as Homeland Security Investigations; Bureau of Alcohol, Tobacco, Firearms & Explosives; Federal Bureau of Investigation; U.S. Marshals Service; West Sound Narcotics Enforcement Team; Joint Narcotics Enforcement Team; Grays Harbor Drug Task Force; Snohomish County Regional Drug Task Force; Valley Narcotics Enforcement Team; Skagit County Inter-local Drug Enforcement Unit; Thurston County Narcotics Enforcement Team; Lewis County Joint Narcotics Enforcement Team; Pierce County Sheriff’s Department; King County Sheriff’s Department; Kitsap County Sheriff’s Office; Snohomish County Sheriff’s Office; Aberdeen Police Department; Auburn Police Department; Bothell Police Department; Bremerton Police Department; Burlington Police Department; Fife Police Department, Seattle Police Department; Tacoma Police Department; Lakewood Police Department; Bonney Lake Police Department; Kent Police Department; Everett Police Department; Mill Creek Police Department; Quinault Nation Police Department; Hoquiam Police Department; Washington State Department of Corrections; Washington State Patrol; Mount Vernon Police Department; Oregon State Police; and Washington and Oregon National Guard.

          Tactical operations were conducted by DEA’s Special Response Teams (SRT) from Seattle and San Francisco. Additional support was provided by Bremerton Special Operations Group; Lakewood Special Operations; FBI SWAT; King County SWAT; Kitsap County SWAT; Mount Vernon SWAT; North Sound Metro SWAT, Pierce County Metro SWAT; Pierce County SWAT; Seattle PD SWAT; Snohomish County SWAT; Washington State Patrol SWAT; Skagit County HRT; Valley SWAT; and the U.S. Marshal’s Pacific Northwest Violent Offender Task Force.

            The cases are being prosecuted by Assistant United States Attorneys Marci Ellsworth and Karyn Johnson. 

SAVANNAH, GA– Three men, all illegal alien residents of the United States, have been indicted for plotting the murder of a whistleblower who exposed a scheme to fraudulently employ other illegals.

Brothers Pablo Rangel-Rubio, 49, and Juan Rangel-Rubio, 42, both residents of Rincon, Ga., and Higinio Perez-Bravo, 49, of Savannah, were charged in a federal indictment unsealed today in U.S. District Court in Savannah, announced Southern District of Georgia U.S. Attorney Bobby L. Christine.

Pablo Rangel-Rubio and Juan Rangel-Rubio are charged with Conspiracy to Retaliate Against a Witness; Conspiracy to Kill a Witness; Conspiracy to Conceal, Harbor and Shield Illegal Aliens; and Money Laundering Conspiracy. Pablo Rangel-Rubio and Perez-Bravo are charged with Conspiracy to Commit Murder for Hire. Pablo Rangel-Rubio also is charged with three counts of Money Laundering Transactions Over $10,000.

The investigation began with the Aug. 19, 2017 death of Eliud Montoya, 41, who was found shot to death near his home in Garden City, Ga.. Two days before his death, Montoya, a naturalized United States citizen employed by a Savannah-area tree service, had filed a formal complaint with the federal Equal Employment Opportunity Commission alleging that Pablo Rangel-Rubio ran a scheme to employ illegal aliens at the tree service, profiting from the company while also skimming pay from the illegal workers. Four months earlier, Montoya also had reported the scheme to company officials.

According to the indictment, authorities allege Pablo Rangel-Rubio paid Perez-Bravo to assist Juan Rangel-Rubio in killing Montoya in retaliation for reporting the conspiracy that is believed to have netted the brothers more than $3.5 million during the approximate 10-year period of the scheme.

“Eliud Montoya was a naturalized citizen of the United States who worked hard and raised a family,” said U.S. Attorney Bobby L. Christine. “He went to the proper authorities to report a federal crime and for that he was murdered. Our office is committed to ensuring justice for Eliud Montoya, a man killed for doing the right thing, by those intent on protecting their illegal profits.”

The investigation was led by Homeland Security Investigations (HSI) with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the FBI, the United States Marshals Service, the Georgia Bureau of Investigation (GBI), the Garden City Police Department, the Effingham County Sheriff’s Office, and the Chatham County Sheriff’s Office.

“As Homeland Security Investigations has stated repeatedly – HSI equally focuses its worksite enforcement efforts on those who illegally work in the U.S., as well as the employers who knowingly hire them,” said HSI Atlanta Special Agent in Charge Nick S. Annan. “This case is an extreme, but clear, example of how far certain criminals seeking to illegally exploit the U.S. labor market will go to protect their ill-gotten gains, and illustrates why worksite enforcement will continue to be a major priority for HSI.”

“The FBI is proud to have assisted our fellow federal, state and local law enforcement agencies in making these important arrests,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “Citizens who uphold the law and report criminal activity should never have to be afraid of retaliation from those intent on breaking the law.

A criminal indictment contains only charges; defendants are presumed innocent unless and until proven guilty.

NASHVILLE, Tenn. – December 14, 2018 – A 45-count federal indictment was unsealed yesterday, charging Dr. Samson Orusa, 56, of Clarksville, Tennessee with maintaining a drug-involved premises; 22 counts of unlawful distribution of a controlled substance outside the bounds of professional medical practice; 13 counts of healthcare fraud; and nine counts of money laundering, announced U.S. Attorney Don Cochran for the Middle District of Tennessee.

Orusa was arrested by federal agents yesterday and appeared before a U.S. Magistrate Judge late in the afternoon.

“Physicians who prey upon an already addicted population; steal from public healthcare programs; and engage in such reckless disregard for patient safety, as alleged here, will face a vigorous prosecution by this office,” said U.S. Attorney Cochran.  “Anyone who contributes to the opioid epidemic plaguing this nation should expect to be targeted by our law enforcement partners and held accountable.”

According to the indictment, as early as January 2014, Orusa opened and maintained his medical practice at 261 Stone Crossing Drive in Clarksville, Tennessee for the purpose of distributing Schedule II controlled substances, including oxycodone, not for legitimate medical purposes and beyond the bounds of medical practice.    The indictment alleges a pattern of conduct by Orusa whereby patients were prescribed oxycodone and other Schedule II controlled substances without obtaining the patient’s prior medical history; performing a credible physical examination or performing a diagnostic workup. 

In one such instance, the indictment alleges that in February 2015, Orusa diagnosed a patient with Chronic Pain Syndrome without performing a specific examination and prescribed oxymorphone (an opioid), Soma (carisoprodol, a muscle relaxer), and alprazolam (benzodiazepine, an anti-anxiety drug).  This regimen is commonly referred to as “The Holy Trinity,” and is considered to be a potentially deadly drug cocktail.  On February 24, 2015, this patient died as a result of ingesting a like combination of drugs.  The indictment also alleges that on April 17, 2018, a patient suffered a heroin overdose in the waiting room of Orusa’s medical office after Orusa prescribed oxycodone and other Schedule II controlled substances, without conducting proper examinations or checking the patient’s medical history.  Other patterns of conduct alleged in the indictment include Orusa prescribing oxycodone to patients identified as high risk and to patients with questionable and falsified drug screens.  Between July 1, 2018, and August 21, 2018, the indictment alleges that Orusa wrote approximately 2,494 prescriptions for Schedule II controlled substances.

The indictment further alleges that on September 14, 2018, the State of Tennessee permanently revoked Orusa’s Pain Management Certificate and on that same day, Orusa wrote 164 individual prescriptions for approximately 12,754 Schedule II controlled substance pills.  Beginning in 2014, several pharmacies in Montgomery County, Tennessee refused to honor prescriptions for Schedule II controlled substances written by Orusa. 

The indictment also alleges that beginning in 2014, Orusa devised and participated in a scheme to defraud health insurance benefit providers, including Medicare, by submitting upcoded reimbursement claims to Medicare, indicating a higher level of service than actually performed; submitting false and fraudulent claims to Medicare for services that were medically unnecessary; causing claims to be submitted to Medicare for prescriptions that were issued in violation of law or otherwise outside the bounds of accepted medical practice; and  diverting proceeds of the fraud.  

The allegations include as part of the scheme, that Orusa would accept or see 50-60 patients or more in a single day; require insurance patients, including Medicare beneficiaries, to visit his office approximately four to six times in a single month in order to increase and inflate reimbursement claims, while cash paying patients were only required to visit Orusa’s office twice per month; and required insurance patients, including Medicare beneficiaries, to accept injections, in order to increase and inflate reimbursement claims. Orusa threatened to withhold pain management prescriptions from insurance patients who refused the injections.  Cash paying patients, however, generally were not required to accept injections in order to receive pain management prescriptions.  

Finally, the indictment alleges that Orusa conducted financial transactions designed to disguise the nature of the unlawful activity and that he transferred or caused to be transferred, proceeds of the unlawful activity to foreign bank accounts; used clinic proceeds to make a $12,451.00 down payment on a 2017 Mercedez-Benz; and wrote a check for the purchase of $100,000 in securities.

“The arrest of Dr. Orusa should serve as a warning to all doctors who fail to practice medicine in an ethical and responsible manner,” said D. Christopher Evans, Special Agent In Charge of DEA’s Louisville Field Division, which oversees DEA activity throughout Kentucky, Tennessee and West Virginia.  “The men and women of DEA are committed to using every available resource to stop the flow of drugs into our communities, especially when the drug dealer is a physician,” Evans added.

“The opioid epidemic impacts families in every community,” said Derrick L. Jackson, Special Agent in Charge at the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta. “Physicians who overprescribe opioids should recognize they are contributing to the cycle of abuse, addiction and overdose that too often ends in death.”

“Illegally prescribing narcotics for profit is a serious offense,” stated Matthew D. Line, Special Agent in Charge of the IRS-Criminal Investigation.  “This investigation should send a message to operators of these illegal pill mills that this activity will be investigated and prosecuted.  IRS Criminal Investigation is proud to work with our law enforcement partners to stop the flow of these illegal drugs into our communities.”

The indictment also contains a forfeiture allegation and seeks to forfeit any proceeds and property derived from the criminal activity and any and all property used to facilitate the unlawful activity, if convicted.

If convicted, Orusa faces up to 20 years in prison on each drug-related count and up to 10 years in prison on each healthcare fraud and money laundering count.

This case was investigated by the U.S. Drug Enforcement Administration; the U.S. Department of Health & Human Services Office of Inspector General; the IRS-Criminal Investigation; the Tennessee Bureau of Investigation; the Clarksville Police Department; and the 19^th Judicial District Drug Task Force.  Assistant U.S. Attorneys Stephanie N. Toussaint and Miller Bushong are prosecuting the case.

An indictment is merely an accusation.  The defendant is presumed innocent until proven guilty in a court of law.   

KANSAS CITY, Mo. – A North Kansas City, Mo., woman has been indicted for embezzling $116,367 from her employer.

Tonya Topel, 41, was charged in an 11-count indictment returned by a federal grand jury in Kansas City, Mo., on Wednesday, Dec. 12, 2018.

According to the indictment, Topel worked at SunSource Homes, Inc., from October 2016 to April 2018 as the officer manager and accountant.

The federal indictment alleges that Topel began embezzling from SunSource a month after she was hired, using several different methods.

Topel allegedly made $47,665 in unauthorized purchases on SunSource business credit cards, including purchasing an airline ticket for her boyfriend. Topel allegedly also issued $40,955 in unauthorized checks to herself. Topel allegedly claimed $19,713 in unauthorized or fraudulent expense reimbursements and allegedly created extra paychecks for herself totaling $5,283. In December 2017, Topel allegedly cashed an unauthorized $2,745 check from SunSource.

The indictment alleges Topel embezzled at least $116,367 from SunSource. According to the indictment, she used the embezzlement proceeds to travel, including to the Bahamas, Arizona, Boston, and Florida. She also used the embezzlement proceeds for retail purchases, restaurants, pets, vehicles, overdraft fees, and to pay her attorney.

The federal indictment charges Topel with two counts of money laundering, related to the payments to her attorney made with stolen funds, and nine counts of wire fraud. The indictment also contains a forfeiture allegation, which would require Topel to forfeit to the government any property derived from the proceeds of the alleged offenses, including a money judgment of $116,367.

The charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.

This case is being prosecuted by Assistant U.S. Attorney Kathleen D. Mahoney. It was investigated by the FBI.

KANSAS CITY, Mo. – An Osceola, Mo., woman has been convicted by a trial jury of stealing $47,340 in Social Security benefits.

Carol Ann Davis, 56, was found guilty on Wednesday, Dec. 12, 2018, of five counts of wire fraud and one count of theft of government money.

Davis was approved in April 2003 to receive disability insurance benefits. Her son was approved to receive auxiliary benefits, and Davis served as the representative payee for her son’s auxiliary benefits. Davis received monthly disability insurance auxiliary benefits earmarked for her son between June 2007 and December 2014. However, Davis’s son was not residing with her during that time frame, and she did not use the benefits for the care of her son. Davis, therefore, was not entitled to receive the auxiliary benefits.

Davis falsely reported that her son lived with her and that she spent the entirety of auxiliary benefits for the care of her son. In fact, her ex-husband gained residential custody of their son in June 2007.

Counts one through five of the indictment relate to five auxiliary benefits checks of $579 each that Davis received from August through December 2014.

Following the presentation of evidence, the jury in the U.S. District Court in Kansas City, Mo., deliberated for about two and a half hours on Wednesday before returning the guilty verdict to U.S. District Judge Brian C. Wimes, ending a trial that began Monday, Dec. 10, 2018.

Under federal statutes, Davis is subject to a sentence of up to 20 years in federal prison without parole on each of the wire fraud counts and up to 10 years in federal prison without parole for the theft count. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.

This case is being prosecuted by Special Assistant U.S. Attorney Courtney R. Pratten and Assistant U.S. Attorney Brian P. Casey. It was investigated by the Social Security Administration, Office of Inspector General.

Spokane – Joseph H. Harrington, United States Attorney for the Eastern District of Washington, announced that Lukes Lorenzo Herrera, age 21, of Grandview, Washington, was sentenced today after having pleaded guilty on September 13, 2018, to being a felon in possession of a firearm. Senior United States District Judge Lonny R. Suko sentenced Herrera to an 18-month term of imprisonment, to be followed by a 3-year term of court supervision after he is released from federal prison.

According to information disclosed during court proceedings, on April 17, 2018, a Sunnyside Police officer stopped the vehicle Herrera, a documented Bell Garden Locos street gang member, was operating. After learning that Herrera’s driving privileges were suspended, the officer placed Herrera under arrest. While preparing to tow the vehicle, officers observed shotgun shells on the passenger floorboard and a handgun on the back seat. After obtaining a warrant to search the vehicle, officers seized a loaded Herman Weihrauch (“HMW”) .38 Special Revolver, shotgun shells, and 9mm ammunition. Herrera is a convicted felon who is prohibited from possessing firearms and ammunition.

Joseph H. Harrington said, “Convicted felons have no right to possess firearms and ammunition. If someone chooses to violate federal law, they will be prosecuted. I commend the outstanding work of the FBI, ATF, and Sunnyside Police Department in investigating this case.”

This case was prosecuted under the Project Safe Neighborhoods (PSN) program. PSN is a federal, state, and local law enforcement collaboration to identify, investigate, and prosecute individuals responsible for violent crimes in our neighborhoods. The U.S. Attorney’s Office is partnering with federal, state, local, and tribal law enforcement to specifically identify the criminals responsible for violent crime in the Eastern District of Washington and pursue criminal prosecution.

This case was investigated by the Yakima Resident Offices of the Federal Bureau of Investigation and Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Sunnyside Police Department. This case was prosecuted by Patrick J. Cashman an Assistant United States Attorney for the Eastern District of Washington.

St. Thomas, USVI – Reynaldo Lerburds, 41, of the Dominican Republic, was sentenced today in District Court before District Court Judge Curtis V. Gomez to conspiracy, United States Attorney Gretchen C.F. Shappert announced. District Court Judge Curtis V. Gomez sentenced Lerburds to 87 months followed by five years of supervised release. Additionally, Judge Gomez ordered that Lerburds pay a $100 special assessment.

According to court documents, on April 17, 2018, the Drug Enforcement Administration (DEA) received information that Lerburds was travelling from St. John to St. Thomas on the car barge and that the vehicle he was driving contained cocaine. The following day, DEA Agents stopped Lerburds after he was observed driving a Suzuki vehicle off the car barge. When agents approached Leburds, they observed several large duffle bags in the rear of the vehicle. Agents conducted a consensual search of Lerburds’ vehicle and found approximately 50 brick-like objects of a white powdery substance. The white powdery substance tested positive for cocaine and weighed approximately 50 kilograms.

The case was investigated by the Drug Enforcement Administration and the Virgin Islands Police Department and prosecuted by Assistant U.S. Attorney Sigrid M. Tejo-Sprotte.

NEW ORLEANS, LOUISIANA – U.S. Attorney Peter G. Strasser announced that JOEL MICHAEL BANE, age 39, of New Jersey, was sentenced Wednesday, December 12, 2018 after pleading guilty on September 13, 2018 to one count of interference with flight crew.

According to the court documents, JOEL MICHAEL BANE intimidated and threatened flight attendants while on Southwest Airlines flight number 208, which departed from Chicago, Illinois, with a destination of New Orleans, Louisiana.  The defendant also refused to comply with the captain’s directives to take his seat for landing.  After the airplane landed, JOEL MICHAEL BANE assaulted the police officers who escorted him off of the airplane.

U.S. District Court Judge Jane Triche Milazzo sentenced JOEL MICHAEL BANE to a term of two years of probation and a $3,000 fine.

U.S. Attorney Strasser praised the work of the Federal Bureau of Investigation in investigating this matter.  Assistant United States Attorney Maria M. Carboni is in charge of the prosecution.

CLARKSBURG, WEST VIRGINIA – Amanze Antoine, of Mt. Vernon, New York, was found guilty this week of three counts involving illegal firearms sales and cocaine distribution, United States Attorney Bill Powell announced.

After a three-day trial, a federal jury found Antoine, age 37, guilty of one count of “Conspiracy to Violate Federal Firearms Laws” one count of “Conspiracy to Distribute Cocaine Base,” and one count of “Unlawful Possession of a Firearm.” Antoine recruited a group of individuals in Morgantown, West Virginia and elsewhere to create false documentation to purchase firearms, transported and sold the illegally obtained firearms from West Virginia to New York. He also distributed cocaine in Morgantown in May 2017. Antoine was previously convicted of two crimes in New York, prohibiting him from possessing a firearm.

“When firearms are combined with illegal drug distribution it is recipe for disaster. Thanks to the jury, our excellent prosecution team and law enforcement partners our communities are now safer with this verdict,” said Powell.

Antoine faces up to five years incarceration and a fine of up to $250,000 for the firearms conspiracy charge,  up to 20 years incarceration and a fine of up to $1,000,000 for the cocaine charge, and up to 10 years incarceration and fine of up to $250,000 for the illegal possession charge. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.

This case was brought as part of Project Safe Neighborhoods (PSN). Project Safe Neighborhoods is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

Assistant U.S. Attorney Zelda E. Wesley is prosecuting the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms, and Explosives investigated.

Senior U.S. District Judge Irene M. Keeley presided.